Obama jobs summit: “No money for jobs”

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Obama jobs summit: “No money for jobs”
By Barry Grey
5 December 2009

Thursday’s White House summit on jobs was an open display of the
callousness and indifference of President Barack Obama and the
American corporate elite to the plight of the working class.

In the course of a two-hour “brainstorming” session with 130 corporate
CEOs, government officials, trade union executives and economists,
Obama flatly rejected any major new allocation of federal funds to
create jobs and ruled out a second stimulus package. Two days after he
announced an escalation of the deeply unpopular war in Afghanistan,
which he said would cost $30 billion a year, Obama insisted at
Thursday’s gathering that the government’s resources were too
“limited” to finance job creation programs.

Instead, he appealed to the multi-millionaire CEOs in attendance to
propose measures that would induce them to begin hiring workers.
“What’s holding back business investment and how we can increase
confidence and spur hiring?” he asked. “And if there are things that
we’re doing in Washington that are inhibiting you, then we want to
know about it.”

The CEOs of FedEx and Walt Disney—whose combined compensation last
year surpassed $61.5 million—responded with demands for cuts in
corporate taxes, a proposal that was widely seconded by the other
business chiefs in attendance. Obama indicated that he would propose
tax incentives for hiring new employees, the dismantling of business
regulations and other measures that will do next to nothing to put
jobless people back to work, but will further bolster the executives’
profits.

On Friday, Obama staged a town meeting in Allentown, Pennsylvania, a
city devastated by the closure of its steel mills. In an attempt to
give his jobs policy a populist gloss, he mildly criticized the banks
for not lending to small businesses and consumers and took some
rhetorical shots at the insurance companies. However, he had nothing
substantive to propose.

Later on Friday, there were reports that Obama might propose using for
economic stimulus purposes some of the unallocated funds in the bank
bailout Troubled Asset Relief Program (TARP)—a drop in the bucket
compared to the scale of the jobs crisis—when he gives a speech on the
economy next Tuesday.

Thursday’s jobs summit was intended as a public relations stunt to
placate and disorient growing popular anger over mass unemployment and
rising home foreclosures, hunger and poverty, and the refusal of the
government to provide any serious relief. Instead, the event only
underscored the oligarchic social interests represented by Obama and
the entire political establishment.

In his opening remarks, Obama said that any steps to address the
soaring jobless rate had “to face the fact that our resources are
limited.” Government measures had to be “surgical,” he declared.

Obama was referring to the massive federal budget deficit of $1.4
trillion. He neglected to note that the major reason for the tripling
of last year’s deficit and explosive growth of the national debt was a
bailout of the banks that, according to the inspector general of TARP,
has allocated up to $23.7 trillion in cash handouts, loans, debt
guarantees and other subsidies to the financial elite.

Nor did he, or anyone else at the summit, choose to mention that
compensation at the 23 biggest US banks, hedge funds and other
financial firms is expected to top $140 billion this year.

In an interview with the Detroit Free Press and USA Today prior to the
summit, Obama said, “It’s not going to be possible for us to have a
huge second stimulus, because frankly, we just don’t have the money.”

The unstated premise of this claim is that nothing can be done that
impinges on the wealth of the American financial aristocracy or
threatens its stranglehold on the economy. Obama made a point of
reiterating his support for the capitalist market, declaring, “I want
to be clear: While I believe the government has a critical role in
creating the conditions for economic growth, ultimately true economic
recovery is only going to come from the private sector.”

This means that job creation must be totally subordinated to the
profit interests of the corporations and banks. That translates into a
policy which facilitates ever deeper cuts in wages and the
institutionalization of sweat-shop conditions. There was no mention,
let alone condemnation, of the wave of corporate wage-cutting that is
driving down working class living standards—a situation that is
intended to become a permanent feature of working class life in
America, and, indeed, internationally.

In a posting on his blog on the eve of the summit, Robert Reich, labor
secretary in the Clinton administration, spelled out in fairly frank
terms the implications for workers of the economic crisis and the
policies of the government. He said that the current recession had
accelerated a “structural change” in the economy.

“The basic assumption that jobs will eventually return when the
economy recovers is probably wrong,” he wrote. “Under the pressure of
this awful recession, many companies have found ways to cut their
payrolls for good. … This means many Americans won’t be rehired unless
they’re willing to settle for much lower wages and benefits.”

In lieu of a federal public works program or even a modest tax on
financial transactions, both of which the administration opposes,
Obama once again promoted alternative energy and “green” investment as
a cure-all for mass unemployment. This bit of charlatanry reached the
point of absurdity with the claim that providing incentives for
homeowners to weatherize their houses—what some at the summit dubbed
“cash for caulkers”—would represent a major step in addressing the
jobs crisis.

Like all of Obama’s other proposals, “cash for caulkers” will have a
negligible impact on unemployment, but it will provide a substantial
windfall for particular business interests. One of the most
enthusiastic proponents of this idea at the summit was the chief
executive of the home improvement giant Home Depot.

In his closing remarks, Obama placed emphasis on driving up US
exports. “If we just increased our share of exports to Asia by 1
percent,” he said, “that’s about a quarter million jobs right there.
If we increased it by 5 [percent], that’s a million jobs. That fills a
big hole; it doesn’t cost money.

“So we are going to be scouring federal regulations, restrictions, et
cetera that are inhibiting export growth.”

The union executives at the summit were eager to jump on this
bandwagon, in order to push their reactionary agenda of trade war and
economic nationalism. Teamsters President James Hoffa attacked
government trade policies as insufficiently protectionist.

Even taken on its own terms, an increase of 1 million jobs would make
only a small dent in the nearly 8 million jobs that have already been
wiped out since the recession began.

What Obama did not explain, moreover, is that expanding exports is
central to the global strategy of the US ruling elite for offloading
the crisis of American capitalism onto its economic rivals, and that
the heart of this strategy is a permanent reduction in the living
standards of the American working class.

The Obama administration is committed to a policy of using mass
unemployment as a weapon to bring the social position of American
workers more in line with that of super-exploited workers in rising
Asian economies such as China and India. By means of wage-cutting,
speedup and cuts in social programs such as Medicare and Social
Security, the US is to be turned into a cheap labor center for exports
to the world market.

This is the class war agenda that underlies Obama’s cynical and
duplicitous posturing at the jobs summit.

http://wsws.org/articles/2009/dec2009/jobs-d05.shtml

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